Tuesday, December 30, 2008

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HDB upgraders to private properties increased by proportion but decreased by absolute number: Even HDB upgraders are cooling

BT reported on 30 Dec 2008 that according to DTZ's analysis, the percentage of HDB upgraders continued to grow. In 2008, a higher proportion of purchasers with HDB addresses was registered with 37 per cent of all buyers expected to be HDB upgraders in 2008 compared to 22 per cent in 2007. Based on available caveats in URA's REALIS, the number of buyers with HDB addresses in Q408 is 582. While this is a preliminary number, it represents 43 per cent of total caveats lodged so far in the fourth quarter. DTZ noted that this is higher than the 41 per cent in Q308, 36 per cent in Q208, and 28 per cent in Q108.

Singapore Private Property Sales Chart

However, if we look at the absolute number of HDB upgraders of 582 in Q4 2008, the number has actually plunged to the lowest level this year and a far cry from the almost 3000 in Q2 2007 during the property peak. The sharp decline in the number of upgraders may reflect that despite the rising HDB resale prices, even HDB upgraders are cooling off from the private property market.

It maybe more accurate to interpret the data as a decline in the proportion of other types of buyers which include speculators, specuvestors, home-buyers etc; rather than an increase in the proportion of upgraders. In a nutshell, I'd see the data as being more reflective of the fleeing of speculators from the private property market, rather than an increased interest in private property among HDB upgraders.

May also want to read:

HDB Upgraders: Lessons learnt from the Property Boom-Bust of the 90s
99 Leasehold Property: Calculation of Depreciation Rate based on Singapore Land Authority Data
Spore Property History 1960-2008
HDB Resale Price Index 1990-2008: Graph & Chart


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